The Internal Revenue Service allows taxpayers to claim a deduction for most of their donations to qualified nonprofit organizations. A charitable contribution deduction not only covers your donations to charitable organizations, but also includes the donations you make to government organizations such as your local police department. A cash or property donation made directly to a police department may qualify you for a deduction.
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Deduction Eligibility Requirements
Before you start donating to your local police department, you need to make sure you understand how much of your donation is tax deductible. Assess your eligibility simply by comparing the standard deduction for your filing status to the total of all your expenses that are eligible to be itemized.
When making this assessment, include the value of your donations since they can help you satisfy the eligibility requirements just as much as your mortgage interest, medical expenses and property taxes do. This step is important because when taking the standard deduction, married filers doing a joint return are allowed a maximum of $600 and single filers are allowed a maximum of $300 in cash donations.
Receipts for Donating Money
For each cash contribution you make to the police department, the IRS requires you to retain a receipt that reports your donation; a payroll record if your donation comes directly from your paycheck; or a bank statement, canceled check or credit card statement.
However, if you make a single cash donation of $250 or more during the year, the IRS requires you to obtain a written acknowledgment from the police station that reports the precise amount of your donation and a statement providing whether you received any benefit from the department in exchange for your donation.
Generally, if you receive more than a token gift of appreciation from the police department, the IRS will require you to reduce your deduction by its value.
Consider Also: Charitable Contributions: Tax Deductions and What You Need to Know
Assessment When Donating Property
When you donate property to the police department such as used clothing, books or furniture, the IRS requires you to assess the value of each piece of property since your deduction for these items generally equals its value. The way you value the items is up to you; however, it must always relate to the price a buyer is willing to pay for it.
For example, if you donate 12 pairs of used jeans to the police department, you can check local thrift stores to see what they charge for similar pairs of jeans to determine value. Under no circumstances should you ever use the price you paid for the jeans when determining used value.
Claiming Your Deduction
When itemizing, include the value of all property and cash donations to the police department on your Schedule A. However, if your total deduction for the year for property donations is more than $500, you must also prepare a Form 8283 and attach it to your return. Form 8283 requires you to report information such as the date of your donation, the date of its initial purchase, a description of all the property you donate and its fair market value.
As of 2020 changes, even if you are taking the standard deduction and not itemizing, you can claim a deduction up to $600 of your charitable donation made in cash. You would enter the amount on line 12b of your 1040 or 1040-SR form. The max amount for married filing jointly is $600, and for single filers the max amount is $300.
Note: There are certain requirements that must be met in order to claim a deduction for charitable contributions as noted in IRS Publication 526.